India's Trade Deficit Widens To 10-Month High In August As Exports, Imports Decline
The merchandise trade deficit was at $24.2 billion in August, as compared with $20.7 billion in July.
India's exports and imports continued to decline on an annual basis, though it was higher than a month ago.
The merchandise trade deficit was $24.2 billion in August, as compared with $20.7 billion in July, according to a press briefing held by the Ministry of Commerce and Industry. This was the highest in ten months.
Key Highlights
Exports fell by 6.9% annually to $34.5 billion in August.
Imports declined by 5.2% annually to $58.6 billion.
Exports rose by 6.9% over the previous month, while imports increased by 10.8%.
Owing to the sharp sequential uptick in merchandise imports in August, the merchandise trade deficit widened to a ten-month high, while printing marginally lower than that seen in the year-ago period, said Aditi Nayar, chief economist at ICRA.
With the monthly merchandise trade deficit prints averaging much higher during July-August vis-à-vis April-June, India’s current account deficit is likely to widen in Q2 FY24 from the $10-12 billion expected in Q1 FY24, Nayar said.
Key Export Items
Exports of engineering goods stood at $9 billion, down 7.7% year-on-year.
Petroleum product exports were at $5.9 billion, 30.6% lower than a year earlier.
Gems and jewellery exports were at $2.6 billion, 21.9% lower on an annual basis.
Organic and inorganic chemical exports were at $2.1 billion, 17.8% lower on an annual basis.
Drugs and pharmaceutical exports were at $2.2 billion, 4.5% higher from over a year earlier.
Key Import Items
Petroleum, crude, and product imports were down 23.8% over a year earlier at $13.2 billion.
Organic and inorganic chemical imports were at $2.2 billion, 26.7% lower on an annual basis.
Imports of coal, coke, and briquettes were 43.5% lower than a year ago at $2.6 billion.
Imports of electronic goods were at $7.9 billion, 8.3% higher over a year earlier.
Machinery, electrical and non-electrical goods were at $4.5 billion, up 16.2% over a year ago.
Gold imports stood at $4.9 billion, 38.7% lower than a year ago.
